Clarita is a single taxpayer that lives in the U.S. with two dependent children, ages 10 and 12. Clarita pays $3,000 in qualified child care expenses during the year.
TABLE 6.1 CHILD AND DEPENDENT CARE CREDIT PERCENTAGES
Adjusted Gross Income Applicable Percentage
Over But Not Over
$0 – $15,000 35%
15,000 – 17,000 34%
17,000 – 19,000 33%
19,000 – 21,000 32%
21,000 – 23,000 31%
23,000 – 25,000 30%
25,000 – 27,000 29%
27,000 – 29,000 28%
29,000 – 31,000 27%
31,000 – 33,000 26%
33,000 – 35,000 25%
35,000 – 37,000 24%
37,000 – 39,000 23%
39,000 – 41,000 22%
41,000 – 43,000 21%
43,000 – No limit 20%
If her adjusted gross income (all from wages) for the year is $21,000 and she takes the standard deduction, calculate Clarita’s child tax credit, earned income credit, and child and dependent care credit for 2021.
Click here to view the Earned Income Credit table.
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Clarita's taxable income is $fill in the blank 1 with a tax liability (pre-credit) of $fill in the blank 2. Her credits are computed below:
Child Tax Credit $fill in the blank 3
Child and dependent care credit $fill in the blank 4
Earned income credit $fill in the blank 5
The total refundable credits equal $fill in the blank 6.